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Sunday, February 19, 2006

The Microscope

There is nothing like running for governor, as both Steve Westly and Phil Angelides are finding out. Both have already run (and won) other down-ticket statewide offices but the press (and the candidate's own opposition researchers) begin to dig deeper into their past for a gubernatorial run.

Today, large stories probing the two Democrats past appeared in the San Francisco Chronicle and the Sacramento Bee.

Each was more than 2000 words long.

The Westly piece looked into his IPO trades while an executive at eBay.

His tax returns show that on 33 occasions between April and October 1999, Westly -- then an executive at the online auction house eBay and today a Democratic candidate for governor -- bought blocks of hot new dot-com stocks at the initial public offering price, a lucrative investment opportunity that underwriters steered to wealthy clients and other insiders.

Then, after the market opened and public trading began, Westly bought more of the same stocks -- almost always an identical number of shares. He paid premium prices, sometimes as much as triple what he paid for the IPO.

A Westly spokesman said Westly did nothing improper, but several experts consulted by The Chronicle said Westly's pattern of stock trading suggested "laddering," a scheme in which investment banks pump up the price of a new stock by requiring IPO purchasers to buy more of the stock after it opens for trading.

"Phil's environmental credentials without a doubt are not just head and shoulders, but planets, above everyone else," said David Mogavero, a Sacramento architect and former Environmental Council of Sacramento (ECOS) president. "When he started in development, he ended up under Angelo's wing and did a bunch of things that were industry standard. But he's learned and evolved and now he understands what will be an effective approach. Is he perfect? No. But no one on the planet is perfect."

But there are critics as well:

"It doesn't matter to me all the pretty things he has done," said Jude Lamare, president of Friends of the Swainson's Hawk, who also was a former president of ECOS. "The bottom line is, Phil talks a good game, but his (open space) development and work against (threatened) species is scary."

In either case, both candidates must brace for increasing media scrutiny.